Suppose the demand function for cable TV service is given by QCTV = 15 - 0.25 × PCTV + 0.0005 × M + 0.3 × PSTV, QCTV is the quantity of cable TV demanded (thousands of households), PCTV is the price of cable TV, M is income and PSTV is the price of satellite TV service. Suppose consumers' income is $50,000 and the price of satellite TV service is $90. How many households would demand cable TV if it were free?
A. No households
B. 15,000 households
C. 67,000 households
D. Every household would demand cable TV if it were free.
C. 67,000 households
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A tariff on a product makes
a. domestic sellers better off and domestic buyers worse off. b. domestic sellers worse off and domestic buyers worse off. c. domestic sellers better off and domestic buyers better off. d. domestic sellers worse off and domestic buyers better off.
In a market economy, private parties are more willing to do transactions when they know that the government is able to:
A. Investigate and arrest people at random B. Force people to do or not do things involuntarily C. Discriminate against one group or another in society D. Revoke private agreements and contracts
For which product is the income elasticity of demand most likely to be negative?
A. Computer software B. Used clothing C. Apps for iPads D. Bread
Refer to the information provided in Figure 6.8 below to answer the question(s) that follow.
Figure 6.8Refer to Figure 6.8. The marginal utility of the first movie rental is
A. 0. B. 15. C. 25. D. 40.